Ben Harris-Quinney Royal Mail Privatisation – where is the debate?

Ben Harris-Quinney is Chairman of the Bow Group & Director of Conservative Grassroots.

The 2011 Postal Services Act was passed with little fanfare or debate. The product of a Liberal Democrat Secretary of State following the failed policy of the last Labour Government, it was also our coalition partner that steered that legislation through Parliament.

Since that time there has been little political debate about the merits of privatising Royal Mail. We have gone from an unheralded Act of Parliament to an equally unheralded privatision without fully considering the impact this might have on the postal service itself and on our party, particularly in rural areas.

It is of great importance that the Conservative Party and the Government pause and consider the implications of pushing through privatisation at this time.

It is likely to be deeply unpopular with the British public, prices will rise at a time we can least afford it, an amenity that many communities consider crucial will be removed and a sell off will also impact on the significant heritage of Royal Mail. Privatisation now, carried out in this manner, is likely to swiftly form a poisonous legacy for this Government, and a poisonous legacy for the Conservative Party going forward.

Only recently Ian Senior, a respected independent postal services economist, predicted that the universal postal service (essentially the six day a week collection and delivery service to all UK addresses) will quickly decline and ultimately Royal Mail will disappear. Given that the government can only guarantee the current universal service until 2015, privatisation will surely act to hasten that eventuality.

The consequences of a sale will be widely felt. Small businesses are particularly vulnerable to price rises. This is not the time to burden them with more. Similarly there are no guarantees that important freepost services such as that for our armed forces serving overseas will be maintained. Should a private equity company end up buying Royal Mail then they may well strip out profit making divisions such as GLS, its international parcels arm, or the Postcode Address File (a database of every address in the country) which is worth possibly £500m.

A figure no less notable than Sir Tim Berners-Lee went as far as to express concern that this would end up in the hands of a business that might make the cost of access to the database prohibitive for budding enterprises.

The importance of both Royal Mail and Post Office services in rural communities in particular cannot be overstated. They are part of the fabric of local life. They are glue that binds our communities together. This was instinctively recognised by Margaret Thatcher and that is why she shied away from selling Royal Mail.

However, the Post Office network has already been separated from Royal Mail and privatisation can only lead in the long term to further fragmentation thus endangering the financial stability of Post Offices yet further.

I believe we should apply some simple tests before proceeding with this controversial sale – has the case for privatisation been made? Is it the best deal for the country? is it popular with the public? is it politically beneficial to our party? In all cases the answer is clearly “no”. Electorally it could be immediately damaging for the Conservative Party, which might explain the lack of debate about the issue.

As with the proposed Forestry sell-off, it is my suspicion that the majority of the general public are not aware that the privatisation of Royal Mail is moving swiftly through Parliament, but that when it is too late and the decisions have already been made, public awareness will rise and it will be met with outrage and uproar.

This is not a left/right issue – successive governments have tried to sell Royal Mail. In addition the economic outlook suggests that the taxpayer is highly unlikely to be able to realise full value from a sale at this time. Indeed it is estimated that revenue from a sale might be as low as £1bn – hardly a sum that can compensate for the political damage it will cause. Ministers and Parliamentarians can save themselves a lot of headaches if they argue that tax payer’s and community interests must come first and therefore the sale is postponed.

It is never taken lightly to advocate a change of policy from a government you support, but we have seen with other issues such as gay marriage and the Forestry sell off, that we interfere with institutions that are sacrosanct to British life and the grassroots of the Conservative Party, without considered national debate, at our great peril.